Tuesday, March 30, 2010

Amway can make you rich. Many IBOs say they were told that Amway was not "get rich quick". But obviously, someone must have given them the impression that Amway would eventually make them rich, otherwise, why would anyone join? Why would anyone want to work that hard and embarrass themselves in front to friends and family to promote a business that will more likely get you funny looks than money. But can Amway actually make you rich?

Well, yeah, Amway can make you rich if you are a diamond selling voicemail services, books, standing orders and function tickets. Amway can make you rich if you own Amway and sell to millions of IBOs who "buy from themselves". Amway can make you rich if you write a book that millions of IBOs purchase. Amway can make you rich if you can get enough loyal downline to keep purchasing products so that you can get the bonuses. But aside from these few people who I just described, the Amway opportunity is more likely to make you broke, or at least lighter in the pockets.

Most IBOs do not even earn enough to cover their monthly voicemail expenditures, much less the other support materials that are pushed on the downline in groups such as WWDB or BWW, or N21. These materials are touted as the "key to success" in Amway when in reality, it is the key to success for the uplines who share in the profits from these materials. The real kicker is despite claims that these materials are key to success, the uplines get their followers to blame themselves if the system doesn't work for them. Kind of like tossing a coin and saying "heads I win, tails you lose". Upline wins as long as you buy support materials from them, and your results are of no consequence to them. In fact they probably don't want new diamonds as they would then have to share the tool money.

So can Amway make you rich? I would guess it is possible, but it is also possible for you to win the powerball lottery. It takes normally, over 100 downline IBOs to create a platinumship. And a platinumship occurs less than once in 200 IBOs. And at that level, you likely make little profit or break even. That tells me a whole lot. What does it tell you?

Monday, March 29, 2010

I cannot even count the number of Amway pitches I have seen on the internet. Because many of them sound the same, or at least very similar, you can probably guess that many of these IBO recruiters were taught by the same LOS such as WWDB or BWW. That is one the major problems I see with the Amway opportunity, that large groups of people are being taught lies or unethical methods of running their business or recruiting. Amway defenders like to cite the fact that 10,000 or even 100,000 IBOs is small in the overall world of Amway and Amway has about 3 million IBOs worldwide. What many Amway defenders won't say is that apparently, most LOSs teach the same basic theories, thus IBO abuse is very significant.

I do not believe that a person can build a large Amway business based on honest recruitment and retention methods. In the past and even now, many IBOs do not know much about the tools business and how you actually get a cut. In the past, some groups lied and claimed they made no profits on tools. Some even went so far as to say their tools company was a non profit company. Eventually, downline IBOs discovered the real deal about the tools and then uplines started to admit that they profited from tools, and started to tell their downline a little about the system. However, these same uplines, many of whom are still active today, have never been held accountable for their past lies and deception. They simply wrote revisionist history where diamonds who got divorced or did something embarrassing were not mentioned or simply disappeared. And IBOs took the bait.

But can you build an Amway business based on pure honesty? I suppose it's possible, but in the US, it would be nearly impossible. Just the mention of the name Amway will turn the stomachs of many potential recruits. It is why some uplines invented the curiosity approach and why some IBOs resort to pure lies to get people to see the plan. Even when I was first prospected over 20 years ago, I was invited to a college "beer bust", only to arrive and see people in suits at a home with the white board. It is why I saw people walk about of board plans once the name "Amway" was mentioned.

So if you are an IBO or simply an information seeker, I think this is a very fair and appropriate question. Can you build a sustainable Amway business based on honesty? What have you seen or experienced thus far? If what I have said is reasonable and true, then is it going to be worth your time and money to build this business? That is something your conscience will have to determine.

Sunday, March 28, 2010

I hear Amway supporters often mention that you will have a real business if you treat it like one. It is my observation that most IBOs do not treat their businesses like a real one. It is also my opinion that the Amway business itself is flawed and many IBOs, in their zeal to sponsor downline, do stupid things at times, such as lying about whether or not it's Amway, or by tricking people into attending recruitment meetings.

Many IBOs do not bother to qualify their prospects. They will sponsor anyone who is breathing. It could be due to uplines making the business seem easy. For example, I have heard that going platinum is so easy that someone's dog can go platinum. Another mistake IBOs make is they do not look at the likelihood of an IBO succeeding. They will sponsor anyone, anywhere. Like real stores, opening a new one creates competition and I don't know of any IBOs who take this into consideration before recruiting a new prospect. They simply think sponsoring others, regardless of sustainability is the key to success. They are dead wrong.

New recruits are also encouraged to partake in the teaching system, regardless of their expectations and business goals. This participation in the system is what often leads to IBO failure. They spend more on tools than what they generate in income. This heavily contributes to the poor retention rate among IBOs. Even IBOs who can progress and make some money will be simply channeling their profits to upline by their tools consumption. It is my informed guess that an IBO must reach the 4000 to platinum level before they start to break even. And If I might add, probably far less than 1% of IBOs reach the platinum level so you are already facing overwhelming odds just to reach the break even point in Amway.

Here's the real test for an IBO. Walk into a bank. Speak to a loan officer and show the loan officer the 6-4-2 or 9-4-2 plan, whichever plan your group uses. And see if the loan officer will grant you a loan based on that plan. It is more likely that you be laughed out of the bank.

When I was an IBO, I was the recipient of a lot of bad advice. I truly believe that WWDB, the LOS I was a part of, is still teaching the same garbage now as when I was an IBO, which in my opinion, completely discredits what an Amway defender, Bridgett Baron claims. To her credit, I have seen Bridgett tell an IBO that a 2% Amway IBO divorce rate it "pulled out of the air (Poota)", the fact that this WWDB IBO is saying it gives much much credibility to the fact that I heard it about 13 years ago. This same WWDB IBO is also claiming that he will be purchasing a home in cash, something which IBOFightback and Bridgett claims doesn't commonly happen, yet here it is.

IBOFightback isn't interested in the "truth about amway". He recently banned me from his blog without warning, because I made two truthful, but painful points about Amway. That their "average income" figure was derived by disregarding inactive IBOs, and that WWDB leaders were never hald accountable for the lies they told, which they are lying about now, such as paying for homes in cash, and how amway IBOs have a 2% divorce rate.

Because apparently, these LOS leaders have never been held accountable for their teaching and their deception/lies, they have been able to keep defrauding downline IBOs for years and they have been making their living doing so, apparently.

Unless IBO leaders and amway defenders start being honest, recruits and IBOs will see the information on the internet and amway sales in the US will (apparently) continue to shrink until the market collapses. I believe the Amway US sales shrank because Amway said sales were flat overall, but were up in India and China. One can deduce that US sales were down (again).

Bottom line, until Amway leaders and IBOs start to be upfront about what they do, and what they are, the stigma will never go away.

Thursday, March 25, 2010

In my opinion, Amway is a pyramid. They are not illegal, but still a pyramid. The reason why they remain legal, apprently is because they do not pay anyone for recruiting downline. But most everyone has been, or knows someone who was recruited by a zealous Amway IBO. The emphasis of most active IBOs is on recruiting and much of the teaching by upline is on techniques to recruit and/or how to talk to people without tipping their hat to reveal the Amway name. Most IBOs are not very good at this and they stick out like sore thumbs in many cases. It's also comical when uplines teachh crazy antics, like how some IBOs use to deny that Amway and Quixtar were even remotely connected.

One of the reasons IBOs use to justify their involvement in the pyramid is that they can earn more than their sponsor. While that is true, it is only because everyone below the emerald or diamond level is basically expendable, or a slave in the pyramid. There are many many IBOs who achieve fairly high levels who quit, or had upline wreck their businesses. Thus even platinums are expendable to upline. In fact an upline might make more money by removing the platinum. For new IBOs or recruits, do you really believe that you are going to ever surpass your current upline diamond or higher? If you believe that, you are sadly mistaken.

And for those who dream of achieving diamond and walking the beaches of the world. How do you think you can ever achieve that? You don't get something for nothing unless someone gets nothing for something. In order for you to receive income for little or no efforts, your downline IBOs must keep purchasing products and replacing IBOs who quit. If your downlines cannot keep up with the attrition rate, your business will collapse in a hurry. Come to think of it, if a diamond can walk away and collect a large income forever, why hasn't anyone done it? I mean we still see crown ambassadors still busy working functions and I don't know of any who walked away to spend their lives jet setting on the beaches of the world.

The sad reality is that you see new faces at meetings and functions, just as often as you see familiar faces disappear. With that kind of attrition rate, you may have to work even harder at the higher levels just to keep your business status quo. In Egypt, the slaves built the pyramids. Do you have enough slaves? What many Egypologists find amazing is how the Egyptians were able to motivate the slaves to keep on going, doing backbreaking work all of their lives. The same can be said of a diamon level business (or higher)

Wednesday, March 24, 2010

1. The Amway products are too expensive to compete with other brands. While IBO's claim high quality, that is subjective and for most consumers, Amway products are not well known and seen as generic in nature with a premium price. Many people consider Amway products "satisfactory" or "average". Some people do enjoy Amway products, but overall in the US market, it clearly indicates that price is a factor and people apparently choose Costco or WalMart. Also, person to person advertising is not as effective as national advertising such as Proctor and Gamble. While Amway did some advertising recently, they are too far behind in the game and their spotty reputation precedes them.

2. The compensation plan is very unfair to new IBO's. The new guy does the work but gets only a tiny fraction of the generous bonus Amway pays out. A new IBO who moves 100 PV would get back $10 or so while layers of uplines split up the remaining $90 or so on bonuses generated by the 100 PV. The only way an IBO can increase volume is to sponsor downline and hope that they will also buy into the system and dedicate themselves to moving volume consistently. But this will also fail due to reasons #3 and #4.

3. Amway's reputation is so bad that sponsoring downlline to build a group is nearly impossible. Even getting people to see the plan is a tough sell. It is why building a business without some deception is nearly impossible. It is why many uplines begin to teach that Amway saves marriages, or that you become nicer by building an Amway business, or that the Amway business is about friends and not money. That is a bunch of BS, business is about making money. If not you have joined a social club.

4. The uplines push the tools scam on their downline while they make handsome profits from these books, voicemails, standing orders and functions. What's more, these tools do not help an IBO build a business because of the reaons listed above. In fact, I believe that any IBO who actually succeed, does so in spite of the system and not because of the system. There is zero unbiased evidence to indicate that the system tools have any relationship to IBO success. And most systems are more alike than not, despite what they may claim.

It is for these reasons that I believe Amway is not a good business opportunity for the vast majority of people. When you factor in the system expenses, you almost assure yourself of a losing proposition. Do the math and do the research. Your conclusion should be clear.

Tuesday, March 23, 2010

Lately, I have been getting a bunch of silly comments from an anonymous commenter from Canada. He implies or makes subtle threats to stop me from blogging, as if that will happen. It sort of made me wonder why so many IBOs, most of whom are losing money, defend Amway so fiercely. It made me realize that for many of these IBOs, they have no choice but to defend Amway. Let me explain.

Many IBOs and prospects, are not where they want to be financially in life. It is why they get lured into Amway, as they truly believe that Amway will make them rich. Sure, upline will toss in the disclaimer that Amway won't make you rich "quick", but certainly they must give enough of an impression that you will get rich somehow. Then the bait and switch occurs.

Once an IBO signs up and decides that he or she wants to give an effort towards making the opportunity work, upline will then speak about the system. How the system is the key to success. That nobody "makes it" without the system. Or that the system is optional but so is success. The system becomes a defacto requirement for many IBOs. Some IBOs do not realize that some uplines make most of their income from the system tools such as websites, voicemail, standing order cds, and functions.

Uplines will also teach that you only fail if you quit. Or you are now a winner for joining Anway and all others are losers. You will eventually succeed if you never quit. Upline may recommend that you listen to or watch inspiring stories of people who never quit. It raises subtle pressure on IBOs to keep going. To walk away would practically doom you to failure in life. In reality, nothing could be further from the truth.

At this point, an IBO has to defend Amway to justify his decision. To quit would place you in the category of "loser" or "failure". An IBO starts to wonder how he or she will accomplish the dreams and goals without the elusive Amway residual income. So now you have IBOs who will fiercely defend Amway because the alternative is to admit that it was a mistake to join Amway. It may mean quitting and cutting losses. The longer an IBO stays in, the harder it can be to quit. My former sponsor has been fully active for 18 years now and he has never gone beyond platinum. I believe his ego will never let him quit at this point.

For me, quitting was just a wise decision, business wise. I was at 4000 PV (with eagle parameters) and I did not earn what upline said I would earn. I also had my upline continuously adding pressure on me to give him control of my life, such as asking permission to buy things, get married, etc. It was becoming very cult - like and I thought it was getting bizarre. I quit and never regretted it.

But many IBOs and Amway zealots defend Amway. Why? Because they have to.

Monday, March 22, 2010

The first time I was prospected for Amway, I was in college. I actually didn't know much about Amway but I had somehow formed a negative opinion of it. Needless to say, when I was invited to a beer bust and it turned instead to an Amway meeting, by impression of Amway got even worse. I eventually did join because a close friend of mine had achieved platinum and he had assured me that it could be done and that he would make sure that I would also achieve it. I did achieve a level just below platinum (4000 PV), but I quit for several reasons. First of all, I didn't make a net profit as the tools ate up my profits. Secondly, the more I progressed in the busines, the more and more my upline wanted control of my life. For example, we were told that we should check upline before getting married, buying a car, or even having children, etc. I thought that was very strange and I eventually left the business.

But in the US at least, I believe Amway's name to be so battered that an IBO cannot sponsor downline and build a business without lies and deception. There are hoards of stories confirming testimony that lies and deceit are common in prospecting potential IBOs. This was extremely rampant when Amway changed their name to Quixtar. IBOs would deny the connection or IBOs would say they are with network 21or WWDB and claim something ridiculous such as Amway simply being their supplier. The promotion of perfect water also brought on silly antics about a $50 case of water being capable of performing miracles. If the opportunity could stand on its own merits, then IBOs would not have to resort to such desperate measures.

Even the Amway presentation if often filled with deception and lies. I remember seeing the presentation and they said shopping through Amway, an IBO would save 30%over local retailers. When I actually saw the catalogs, I wondered where the savings was. The 6-4-2 plan or similar variations are made to sound easy and the presenter talked about lifelong residuakl willable income, which I also find to be deceptive if not an outright lie.

But can Amway be successfully promoted without lies and deception? It is my opinion that an IBO has no chance of building a business by being completely upfront and honest about Amway and about being an IBO. Even with lies and deceit, many IBOs still cannot get people to see the plan or to buy products. An Amway rep has stated that very little Amway products are sold to non IBOs. So if you cannot sell products and you cannot get people to see the plan, you cannot build a business and if you are purchasing tools, you are simply digging yourself a financial hole that will only grow larger as time passes. The cost of 100 PV is alreay more than what most families and/or singles spend in a month on household products. This means that most people simply cannot sustain themselves in the business and it explains why most IBOs drop out in the first year.

It is why lies and/or deception are needed for an IBO to have a chance at promoting and building an Amway business.

Friday, March 19, 2010

Many IBOs "think" they have become nicer people as a result of their association with other IBOs and because a part of the system they are with advises them to read self help books. They are also taught that as a side benefit of the Amway business, that they are nicer people. Of course, many IBOs mistakenly think that they started a business not to make money, but to become "nicer".

I certainly agree that some people can benefit from positive books and association with others, but for many, it is not a genuine "nicer" person, but simply a phony personna that is put on in order to recruit potential Amway downlines. That is how my former sponsor appeared to me. Because I had known him for a long time, the "nicer" looked as phony as phony can be. There are many examples of phony niceness that some IBOs profess. Even Amway's biggest defender was apparently called a "cyber bully" by an Amway corporate blogger and some others for making disparaging comments about those with opposing views. Others have resorted to calling people broke or losers simply because they did not agree that Amway was their savior.

On this very blog, there are comments, I assume by IBOs, that make implied or subtle threats. Some of these comments are not subtle at all. In fact, in my blogging experience, it is usually the IBOs and Amway defenders that resort to name calling. I suspect that is because the facts are on the side of the Amway critics. For example, it is a fact that most IBOs never make a dime, even if you don't count the ones who "do nothing". If you look at system IBOs, then the vast majority never make enough to pay their voicemail expenses.

Even the coveted diamond level appears to be a facade, especially seeing diamonds quit, resign and simply walk away from the business without the lifelong passive income. A recent triple diamond's bankruptcy revealed some financials and it wasn't all that impressive considering the size of his business plus longevity in the business.

So IBOs, are you a nicer person? Is it evident by your words and actions? It doesn't appear to be very clear to me.

Thursday, March 18, 2010

One of the things that irks me about some Amway leaders is their blatant revisionist history. They never take responsibility for anything except for the miniscule amounts of success that seeps through their system. Real problems and issues are ignored, or leaders pretend they never happened, or they simply rewrite history to fit their goals and agendas. And to make matters worse, these same leaders teach their downline to accept personal responsibility for their failures, even when downline faithfully purchase and apply teaching from tools such as voicemail, standing orders and functions.

One good example was the complete lie that nobody made profits from tools. Then when caught red handed, leaders now admit that they make profits from tools but nobody seems to know exactly how much, or how you actually qualify to receive compensation. And there was no backlash for having told such blatant lies.

Leaders in my former LOS, WWDB used to teach how so few IBO couples ever gets divorced. I heard that Amway couples had a 2% divorce rate as compared to the rest of the world where over 50% of couples get divorced. Yet, WWDB uses their own revisionst history. One good example is Howie Danzik, who WWDB says built his business as a single and later married Theresa Tsuruda. I guess I must have imagined the emerald function I attended where Howie and his wife at the time, Susan, said they built the business together. There are other examples of this, but what amazes me is how the downlines seem to ignore these facts.

Another recent example was how an IBO insisted that a prominent triple diamond in WWBD did not have homes foreclosed or was not involved in bankruptcy proceedings, even when there are numerous public documents providing ample evidence that it is true. It's mind boggling. If Tiger Woods were a diamond and denied that he had any affairs, I bet his downline would believe him as well. Scary.

I just have to wonder when IBOs, who dedicate themselves to various systems, will ever hold these leaders accountable for their actions. If you buy a television and it didn't work, you would ask for a refund. Well, if those standing orders and functions contain vital information and you apply them and they don't work, you should ask for a refund as well. People should also ask upline the tough questions. If someone gives you bad advice, they should be held accountable. If someone tells you buying a home with a mortgage is stupid because of the interest you will pay, then you find out they have "interest only loans", that makes them a hypocrite and their advice should be questioned.

Don't allow these well compensated leaders to simply rewrite history to ignore their mistakes and trangressions.

Tuesday, March 16, 2010

One ofthe bogus things my upline taught us was that the Amway opportunity was fair. That it was a completely level playing field. On the surface, that sounds right because "everyone starts at zero". While everyone does start at zero, the compensation plan is poor and in my opinion, should be revamped so lower level IBOs make more money. It would probably help with IBO retention and maybe, some higher level leaders wouldn't have to work so hard to keep replacing people who quit.

If you are a new IBO, then you might not be really familiar with the Amway compensation plan. Amway pays out about 30+ percent of their gross as bonuses. Thus if you move 100 PV in goods, or about $300 in sales, then Amway pays out about $100 in bonuses. You as a new 100 PV IBO, would receive about $10 and your uplines, some of whom don't even know you exist, will split up the remaining $90 in bonuses. It truly is not a case of doing the work and gettung paid.

And something significant to think about. In what other sales profession are you compensated so low (3%)? I can only think of real estate, but in real estate, your sales are likely in the hundreds of thousands of dollars. In just about any other sales related profession, you get a much higher cut than 3%. Yes, your bonus or comission can be higher if you move more volume, but then you are likely receiving more money because you are now exploiting people doing 100 PV who get only $10 back.

And then even after you consider the unfair compensation, you must factor in the cost of tools. Most uplines promote tools (cds, voicemail, functions) as vital to an IBO's success. Some uplines push the tools harder than others. But the tools purchases will often be the primary cause of IBO financial losses because the cost of tools will normally exceed an IBO's bonus. It is very common in the US for monthly tool purchases to exceed $200 a month on average, and very very few IBOs will ever reach a high enough level in the Amway compensation plan to earn enough just to break even. Also, the tools apparently do not work. There is no unbiased evidence to suggest that tools have any causal relationship to IBO success.

With Amway's reputation and the unfair comepnsation plan, IBO retention is very poor. About 2/3 of IBOs don't last even one year, and very very few will ever last more than another year or two after that. What happens is IBOs begin to figure out that recruiting downline is next to impossible and therefore, generating more volume is nearly impossible, even for individuals with skills. If you are a new IBO or a prospect, I encourage you to sit down and really look at the math and factor in the cost of tools. There are many ways to earn a dollar, I just don't feel that Amway is a good way to do that.

Monday, March 15, 2010

One of the things I often thought odd as an IBO was how our upline would keep teaching us that the Amway business was all about "helping people". Somehow, our upline felt that showing someone the plan or talking to them about the business was helping someone. That is because our upline felt that everyone was dooomed for financial failure if they didn't join Amway. Of course, nothing could be further from the truth now that I am looking back. In fact, I would have to say that building the business and purchasing tools was the CAUSE of financial disaster for some of my fellow IBOs. I remember reading about more than one home foreclosure and a couple of bankruptcies.

It's like IBOs held some dark secret and they could save the world by sharing this secret with prospects. So the theme of many voicemails (Amvox at the time) was about how IBOs in the group were saving the world by helping people. I used to wonder how we were helping people when we basically only "helped" IBOs who wante dto build the business. If someone declined to join, they were forgotten. Our upline said we threw them a life preserver but they rejected it, so we are moving on. it was often compared to a church activity where IBOs are saving souls. I actually found this extra weird because we were often taught that we could give the church money in the future ($10,000 checks) and we could serve in ministry after we were "free". I find this ludicrous now, but at the time, we were told that this was delayed gratification. After I left Amway, I spoke to the senior pastor of the church and he opined that Amway was harmful to many because it simply held too many empty promises. In other words, they promote big dreams and wealth, but very few ever attain any success, for whatever reason. The pastor said the reason for the low success was not relevent. The fact that it was rare to see success was enough to conclude that Amway was not a good opportunity.

In fact, some diamonds can be seen as prosperity preachers. They speak about wealth attained through Amway when in reality their wealth may come from other sourcse, such as tools income, yet they falsely promote Amway as their primary source of success. Then they bait and switch IBOs and tell them that the tools system is the only way to succeed, all the while profiting handsomely from the tools. They then justify their conflict if interest by claiming that IBOs are helping people and/or doing God's work by joining Amway. I believe many IBOs are giving false hope and promises to prospects as taught by upline leaders. All the while they themselves are losing money while thinking they are supporting a noble cause. I hope they awaken before it's too late.

Thursday, March 11, 2010

One of the things that keeps some IBOs going is the "harsh reality". What I mean by that is for some IBOs, once you have been in Amway for a while, it can be hard to quit. You were possibly recruited with dreams of lifelong residual income and walking on all of the exotic beaches of the world. Retiring young and spending that time with your wife and family. To quit means an IBO would have to face the reallity that these dreams will not come true, at least not with the Amway busines. The fact is that the Amway opportunity probably would not have delivered those dreams anyway. Even a diamond more than likely cannot afford those dreams. In fact I would estimate that most diamonds, if they flaunt some excessive lifestyle, are near broke or in heavy debt as a diamond income cannot sustain a jetset lifestyle, save for a founders crown ambassador or something similar. I believe the prominent WWDB triple diamond bankruptcy shed a lot of light into the finances of an upper level pin and it wasn't as impressive as I would have thought.

But what really is the harsh reality? It's working hard only to drift between 100 and 500 PV. It's finally sponsoring a new IBO only to have a downline quit. It's talking to people about Amway and getting laughed at or getting rejected. It's your upline or sponsor pushing you to do more. Possibly your upline is one who questions your manhood if you aren't working hard enough. It's your upline or sponsor reminding you that a winner doesn't miss functions, especially the major ones. It's staying up late for team meetings or nite owls when you need a good nite's rest to do your job the next day. It's driving the miles to show a plan, only to have your prospect not show up. It's having to be deceptive about what you are doing. It's skipping functions with family and friends so you can be core to the business.

As IBOs, do you see any of this? I saw some of this during my involvement. While I have not been an IBO in some years now, I still see many testimonies and comments by more current and even some active IBOs to indicate that a lot of this still goes on. While Amway defenders will deny it, I see no reason why any of this would have changed over the years since Amway has made no significant changes to stop abusive uplines. If Amway did make any changes, they are not immediately apparent and the continuous string of comments and testimonies do not confirm that any clean up has been done.

For active IBOs or prospects, these are the harsh realities that may be attached with the Amway oppportunity. Much of it is because of motivational groups such as WWDB, but if you are seeing these traits in your group, ask the tough questions. If you happen to decide that the Amway opportunity is not for you, take heart! There are other ways to achieve your financial goals and dreams and there are moe efficent ways out there. Sometimes, quitting something that isn't working is a wise business decisions and sometimes you can lose more by not quitting. Good luck in whatever you decide.

Wednesday, March 10, 2010

In recent comments, one thing I have seen about Amway IBOs is "desperation". I believe this to be true as IBOs who are trying to build a business are in a precarious position. For one thing, Amway products in general are not priced at a competitive level with big retailers so IBOs are at a disadvantage. Lacking retail sales, and IBO must self consume 100 PV, which can cost about $300 or so on average. Most people that I know do not spend $300 a month on consumables, toilet paper and vitamins that IBOs claims simply "replaces your shopping habits" Even when I threw a party for 40 guests at my home, I still did not spend $300 at Costco that month for my own goods plus the party.

So why are IBOs "desperate"? I believe it is because the cost of the goods starts to become a burden for most IBOs and the disadvantage in cost makes selling products very very difficult. So with that in mind, the only other way for an IBO to increase volume is to sponsor downline IBOs in the hopes that they will also move volume. Thus IBOs do not get paid directly for recruiting (which allows Amway to remain legal), but the emphasis of most business builders is to sponsor downline because selling is more difficult. And because many IBOs are "desperate" to generate volume, they resort to trickery, deceit, and sometimes outright lies in order to get people to a recruitment meeting. It is why Amway has developed a reputation in North America. I believe Amway sales in North America is shrinking because of this, but I cannot confirm it since Amway no longer reports North American sales seperate from their global sales.

But this continued emphasis on sponsoring and showing the plan is the very reason why most IBOs can never build a sustainable business. For example, the Walton family can take a trip to Mars and WalMart will continue to have their sales go through the roof because they offer good products and rock bottom prices. Customers see value in WalMart goods and will shop there loyally for decades to come. Amway IBOs rely on IBOs joining and primarily self consuming products. This doesn't work because two thirds of IBOs quit in less than a year, possibly because there's not enough value in remaining, and the vast majority of the remaining IBOs quit within a year or a few years thereafter. Some diamonds may be able to keep replacing the quitters, at least enough to sustain some Amway income, but probably not enough to "walk away" from their businesses. For smaller volume IBOs, they simply cannot keep replacing what few downline they may have had, and eventually, they quit too.

For many, it's hard to quit if they were "serious" for a while because they have invested time and money and they are hopeful that their investment will eventually pay off. But at some point, it seems that desperation eventually sets in. Even diamonds who may be living bonus check to bonus check, probably cannot quit because they too, have invested much time and effort into their business. But recently, we have seen evidence of what I speak about. Diamonds quitting, diamonds resigning, and diamonds in financial difficulty. The writing is on the wall.

Tuesday, March 9, 2010

One of the most vital things about running a business is your bottom line. The bottom line is a net profit for a business. But apparently, many IBOs do not look at their bottom line, probably at the suggesttion of their uplines. I believe uplines ask downline to ignore the bottom line because for most IBOs, even dedicated ones, is a loss. Thus IBOs are taught that Amway saves marriages, or that the Amway oppportunity has made you a better person, or that the Amway opportunity has made you a better husband. All of these things are great side benefits for having joined Amway, but in strict business terms, most IBOs are failures in the profit and loss category. (And if you are out almost every nite building an Amway business, are you really a better husband and father?)

The facts, some of which are published by Amway reveals this message quite clearly. Most IBOs cannot or do not sell a lot of Amway products. Most IBOs, even with much work, will never sponsor a downline. Even those who manage to sponsor others are likely to see these downline quit within the first year. In fact, many IBOs cannot even find someone open enough to see the Amway business plan. I believe it is why you hear stories of trickery, lies and deceit involved in many stories about Amway. Even the IBOs who do the work are likely to earn less than $1 of NET profit after taking business expenses into consideration. In fact, when factoring system expenses, most system IBOs operate at a loss!

So for most IBOs, the bottom line is a loss. Yes, some IBOs make money. Some make a lot, but those making money seem to have been around for a long time. I believe that too many observers mistakenly believe that the platinum level is profitable. I believe that a dedicated system platinum earns very little after all of the expenses associated with the system are factored in. This was confirmed by an attorney general study conducted in Wisconsin showing the average platinum lost nearly $1000 a year. While Amway defenders will claim that the study is dated (from the 1980's), I would like to note that the basics of the business hasn't changed. In fact, the advent of KATE and some other system materials make the expenses even higher than back when the Wisconsin study was done!

So IBOs, what does your bottom line look like? Is there anything left of your PV bonus check at the end of the month? Or is it a loss that you justify by claiming you are a nicer person? Would you have joined if the plan had said you would be nicer but losing money? Would you have joined if you knew you would be losing money but have new Amway friends? Would you have joined if you knew that a platinum might be losing or not making much money? The bottom line in any business should be a profit. What does your look like?

Monday, March 8, 2010

One of the selling points of the Amway business is for people to do the work once and then reap financial benefits for life. But that simply does not happen for the vast majority of IBOs. The reason why most IBOs do not have a sustainable business is because their business is not based on sales to genuine customers with a genuine need. Most IBOs themselves will not buy Amway products once their affiliation to Amway is over.

If you are an IBO doing your 100 PV monthly, then your only way to increase volume is to sponsor downline in hopes that they will also do their 100 PV as shown in the plan. And even if you are somehow able to accomplish this and sponsor a bunch of people as shown in the plan, chances are that many IBOs will "do nothing" and of the remaining, some will move 100 PV, but they will likely quit in one year or less.

In many or possible most cases, IBOs are only selling the Amway opportunity and not Amway products. They sell the possibility or hope that they will build a business, walk away and collect untold wealth for the rest of their lives. It isn't going to happen. Say for example, you sold 100 PV monthly on a consistent basis to customers. These customers will automatically go online and make purchases when they run out of their products. If you are lucky, they will also refer friends to make purchases. But most IBOs do not sell products, they are selling the opportunity.

That brings up the next point about why an Amway business is not sustainable for most. The products cost more than most other retailers. That will limit the potential for customers and referals. Amway defenders like to cite quality issues, but most customers who shop online aren't familiar with Amway products and have no way to know whether Amway has quality products or not. That leaves them to decide based on prices. And Amway in general, costs much more than Walmart for the same or similar products. A tough sell indeed.

Thursday, March 4, 2010

Ever since the "tools scam" in Amway was exposed by the internet and further confirmed by Dateline and previously by 60 Minutes in expose's, there has been a sort of "internet war" between Amway critics and defenders. The defender's mantra is almost always "we don't do that", which I find ironic, because often, these same defenders admit they are from the more abusive of the lines of sponsorship. While I admit there may be some "rogue" IBOs who focus on selling product, they are the rare exception and not the rule. Most IBOs belong to an LOS who sells tools such as cds, voicemail, seminars/function and other support materials. In the past, uplines lied and denied that they made any tools profits. Now that the lie has been exposed, the IBOs seemingly have just forgotten about this and gave upline a free pass while uplines continue to display a lack of transparency about the tools business.

I will also acknowledge that Amway may have tried to make some changes to clean up some of the abuse, but at the same time, many of the changes appear to be cosmetic and meaningful changes are not apparent. Take accreditation for example, what did it truly accomplish? Not much in my opinion.

The most hard core defenders of Amway act like internet trolls at times, setting up alerts and dropping uninvited into conversations whenever the word Amway comes up. The weaker defenders of Amway will drop into a conversation and will disappear in a flash once they get schooled by the facts. One good example was someone denying that diamonds spoke about buying homes in cash. When other commentators confirmed hearing this claim, the AMway defender tucked tail and ran. The more elusive defenders of Amway will try to get a critic to defend an extreme postion, or will try to say that critics paint too broad of a picture. For example, when you say upline, why refer to all upline. A valid point, but when making a defense, these same defenders will paint all of the upline as "rosy" by saying things like "we" don't do that, implying that not a single person in the LOS does that, which is almost always false.

But the most important thing that information seekers should note is that Amway defenders have something to gain by defending Amway. Amway defenders may have something to gain and may even lie and cheat to make Amway look good. Some diamonds in the past even made ridiculous claims just to sell their "perfect" water product. Amway critics have nothing to gain. Some of us do this only because there are many injustices placed upon the masses of downline, and not only did the upline get away with past offenses, many of them continue their practice of bilking their downline for personal benefits.

Wednesday, March 3, 2010

One of the things IBOs get attracted to is how uplines will promote traditional family values. They may talk about the "Leave it to Beaver" days where the man works a job and the wife takes care of the home and drops the kids off at school. While some of these values are great, they are not reality in today's world. The speakers at some Amway meetings may recruit others by saying you can have this out of the box lifestyle if you will only build your Amway business. This gets the wives or girlfriends excited as they would love to not have to work a 9-5 job.

Ironically, an IBO's desire for more time and money, more often than not, will result in less time and money for an IBO and and IBO's family. They will take time off to shopw the plan, attending countless numbers of meetings and to attend functions. They are taught to "delay" gratification, but many do not realize that they are permanently delaying gratification by participating in the "systems".

An IBO's belief is often compartmentalized into thinking that showing the plan, listening to standing order, submitting to upline's advice and attending all functions will result in guaranteed success within 2-5 years. Anyone who speaks a differing opinion of this is "negative" and should be avoided. Sadly, those who put forth such dedication and invest in the system are rarely rewarded with success. Even those who achieve the platinum level may often find that the net profit they realize is less than a minimum wage job with the same number of hours put forth. And maintaining a platinum level is a daunting task.

My former sponsor achieved the platinum level in less than two yaers, but he never achieved Q12 status, and he never went beyond the platinum level. He has been involved for nearly 20 years now, and last I heard, is below the platinum level. All of that work and effort and I wonder if he even has a net profit of $1.00 for all of his efforts?

Yet, many IBOs continue to see the world through rose colored glasses, thinking that they will succeed if only they will never quit. They disregard the fact that 2-5 years has come and gone. They do not see that their bottom line is nowhere near what they were led to believe. But they believe that Amway will be their financial savior, even though there are facts and red flags pointing to the obvious reality that they will never achieve what they initially set out to achieve.

I hope my blog will get a few IBOs to take off the rose colored glasses for just a second.

Tuesday, March 2, 2010

When I was an IBO, I heard the saying over and over. Never quit, success might be right around the corner. There were countless stories by diamonds and emeralds of how they were on the verge of quitting, but stuck it out and somehow "maade it". I also heard stories about why people should not quit because even if you were told "no" a thousand times, the next prospect might say "yes" and turn your entire business around.

I believe these are all heartfelt stories. However, I believe that many stories are embellished and made to order. Or in other words, made to fit a standing order. If you listen carefully to many of the standing orders, you will notice that the higher pins were consistently sponsoring people and generally achieved the platinum level in 18 months or less. There are exceptions of course, but the majority of stories I heard seem to have had the same theme.

But for IBOs and new recruits, if you aren't constantly bringing in new people to the open meetings, and sponsoring new people, then you are very unlikely to ever achieve much in Amway. Statistically, less than one half of one percent ever reach platinum. Thus if you are unable to grow your organization or group, then you are unlikely to be that on who "makes it". Success is not around the corner as some uplines will have you believe. If you take 100 "no's" and then someone finally says "yes" then chances are that person who said yes, will "do nothing", or do little. Chances are that person won't sponsor anyone or show anyone the plan. Chances are that person won't even be in the business a year later.

It might be a good idea for IBOs to take a step back and take an unbiased look at their business and their business activities. Is your group growing consistently? Is your volume increasing each month? Are you able to get people interested in seeing the plan on a consistent basis? If you answered "no" to any of these points, then you are unlikely to progress and achieve in the Amway business.

One important thing for people to note is that there are many ways to achieve your financial goals and dreams. Amway is probably not the best vehicle for most. The numbers speak for themselves. If less than one half of one percent ever reach platinum, where allegedly, IBOs finally see a profit, then I would say your chances of success are better elsewhere, evern if that is a second job. The average "active" IBO earns about $115 a month according to Amway. Considering all IBOs, then the average income is probably about $85 a month. You can earn more than than working 4-5 hours a week at minimum wage.

Monday, March 1, 2010

One of the "false hope" things my upline used to tell our group was that everyone was going to succeed. That although things are tough, one day we will all be at diamond club together looking back at the struggles and laughing. Well, nothing could be further from the truth. One of the things that Amway promoters like to state is that "anyone" can succeed", but in the same line of reasoning, I could also say that "anyone" can win the lottery. The same thing can apply to not "everyone" can succeed in Amway and not "everyone" can win the lottery. Amway is not a game of chance like the lottery, but this still applies.

Using the term "anyone can succeed" is simply a statement that gives people hope. It appears that Amway promoters love to use the psychology of giving people hope as a means of recruiting and retaining IBOs. Hope is what keeps people motivated. The problem with the Amway opportunity, is that it is false hope. It is very easy to see that in most groups, the majority of downline IBOs will lose money. The majority of active IBOs, if they receive a bonus, will get only about $10 a month from Amway. If they use voicemail, or subscribe to standing order, they are already at a net loss for the month. Never mind the open meetings, major functions and other expenses associated with the Amway business.

I believe it is hope that makes gambling popular. One pull on a slot machine handle can change your life. Many IBOs believe that one good run of business can change thir lives. Unfortunately, the Amway business has not appeared to produced much fruit in North America. It seems that any new success is simply replacing older pins who no longer qualify. In my opinion, it is a telltale sign that Amway has stopped reporting North American sales. I'm sure if sales were up, they would stand on their rooftops and trumpet out such success. Instead, it is covered up like any disparaging news about this business opportunity.

To summarize, "anyone" can succeed. But that simply means that you never know who the next platinum or diamond may be. You don't know where they will come from. And it is unlikely to be a new recruit. If you are using a system such as N21, WWDB, or BWW, then I can say with certainty, that "everyone" cannot succeed.

About Me

I am writing this blog based on my experiences in the Amway/Quixtar business and the opinions I have formed based on those experiences.
I ran a 4000 PV business (with eagle parameters) only to discover that I was not profitable!
I'm not here to encourage any IBOs to quit, nor do I wish anyone to fail. I do encourage IBOs to ask their upline tough questions and I encourage IBOs to closely monitor their profit and losses as does a traditional business owner.

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